Precision Report

Multi Carrier Compliance is Crucial to Managing Peak Season Shipping

Published Date
11/7/18 12:30 AM

November is upon us and carriers are forecasting record numbers of parcels this peak season. In the latest Precision Report we look at how shippers can ensure timely and cost-effective deliveries with multi carrier compliance.

November is here, and with it comes some of the biggest shopping days of the year. On 11 November, China kicks off the e-commerce spending spree with Alibaba’s Singles’ Day. Next up is Black Friday, falling this year on 23 November. Black Friday may have started off as a US tradition, but it has become a global phenomenon. Shoppers across Europe, Southeast Asia, South Africa and much of the world have embraced the sale with Black Friday deals available online and instore.

Following hot on Black Friday’s heels is Cyber Monday. The online shopping event has been growing in popularity. Adobe Insights reported that in 2017, online sales reached a record $6.59 billion in the US on Cyber Monday. That was an increase of nearly 17 percent on the year before. Mobile e-commerce made up $2 billion of that amount — also a record.

Those figures are impressive, but Cyber Monday is seriously outspent by the biggest single online shopping day of the year — Singles’ Day. In 2017, Alibaba claimed $25.3 billion gross merchandise value for Singles’ Day. This year, Lazada — an e-commerce company owned by Alibaba — is launching a similar event. Lazada will hold an 11.11 “shopping festival” across Philippines, Vietnam, Singapore, Malaysia, Thailand and Indonesia.

Big or small, retailers cannot afford to miss out on the holiday spending bonanza. But if they cannot deliver in a timely fashion, they’ll suffer a higher than usual number of returns along with damaged reputations.

Growing Volumes = Growing Need for Multi Carrier Compliance

This holiday season, UPS expects to handle a whooping 800 million packages. That’s a predicted increase of 50 million packages over the 2017 holiday season’s 750 million. FedEx too is preparing for a busy season. The carrier has been working on increasing capacity for years. This includes building 15 new hubs as well as leveraging robotics and artificial intelligence in some operations.

Holiday season volumes are astounding. They also highlight the importance of multi carrier compliance. In the salad days of e-commerce, it was possible — even preferable — to use a single carrier. But these days that is risky. Carriers and the services they offer are continually changing. A business that leverages multiple carriers can provide more shipping options and competitive shipping rates for customers.

Shippers who have agreements with two or more carriers generally have separate terminals to process shipments with each one. This makes it labor-intensive and time-consuming to compare rates and routes. It also means your parcel shipping data is fragmented. Furthermore, different carriers have different rules and requirements. Carriers are stringent about making shippers comply with their labeling and electronic communication standards. Research by Pitney Bowes found that globally, volumes grew to 74.4 billion parcels last year, a 17 percent increase over 2016. If these standards were not enforced it would not be possible for carriers to process such high volumes through their networks.

When you are dealing with different sets of requirements and multiple staff members using separate terminals it is easy for keystroke and human errors to occur. Don’t expect any sympathy for this — expect delayed deliveries, lost packages, extra costs or the inability to use particular services.

Multi Carrier Compliance and Direct Injection

More and more shippers are using direct injection to provide a better service to customers and to reduce spend. Also known as hub induction or zone skipping, direct injection aggregates orders from multiple customers for the first leg of their journey. After that, they are put directly into a parcel carrier network for the final delivery. This is particularly advantageous when shipping across borders. It can significantly reduce the customs clearance costs and also simplify the overall process.

Carriers offer consolidated services where they will do this on your behalf. Alternatively, a shipper can implement it themselves and choose a carrier for first leg and final mile. The second approach provides for greater flexibility. It allows shippers to choose local carriers in different countries and regions whose network best serves their customers. The downside of direct injection is that it can greatly increase the number of carriers a shipper must deal with. And of course, each carrier has their own standards and requirements. That means more carrier compliance headaches.

Demanding Customers and Delivery Personalization

Both retail and B2B customers can, and often do, mandate shipping requirements. This generally means specifying a carrier, a service or an account. These requests can potentially impact entire shipping processes particularly in highly automated or high volume environments. Shippers must meet the customer’s and the carrier’s requirements from within their own system.

The end goal of any shipper is to deliver products to customers on time, without damage, at minimal cost and in the most efficient manner possible. As customers continue to purchase goods online and customize their shipping options, businesses must be able to accommodate delivery personalization.

Shipping solutions with multi carrier compliance simplifies this process. A comprehensive multi carrier shipping solution will allow you to seamlessly switch between carriers from a single system. That means you can get the best rate, route, service level and transit time for each shipment. Equally importantly, it will allow you to track any package with any carrier, anywhere. It will also ensure that you remain compliant with carrier rules and shipping requirements. Multi carrier shipping software makes it easier for businesses to meet customers expectations and deliver high-quality service while complying with carrier standards and well as the appropriate shipping laws and regulations.

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